How Falling Fed Fund Rates Increase the Loanable Funds - Assignment Example

My answer is correct but it is not detailed to thin lather. Both answers explain the effects of such a situation in the short run. My answer gives general information while the teachers go as far as categorizing the major economic components that face the full impacts. For instance, the teacher talks about how businesses, households, commercial banks, and the foreign exchange markets react to lower Fed Fund Rates. Nevertheless, both answers explain the result of the expansionary monetary policy that is enacted during the trough phase of the business cycle.

Question Three
In this question, both answers are correct though the their slight difference in the explanations. Both answers focus on the long-term effects of a strong expansionary policy and the effects. Some of the effects discussed include price levels, aggregate demand, aggregate supply, inflation, rate of unemployment, and Gross Domestic Product. In my own opinion, the assignment is ninety-five percent informative. Read More